The impact of the national practitioner data bank on
licensing actions by state medical licensing boards.

Abstract:

The United States Congress mandated the establishment of the
National Practitioner Data Bank in large part to decrease the likelihood
that errant individuals might be able to avoid detection by licensing
boards and practice medicine. We use a decade of longitudinal data
(1985-94), for each of the 50 states, to evaluate the Bank's impact
on state licensing board actions, during the four years following its
1990 birth. The results of a pooled, time-series analysis reveal that
medical board restrictions on physicians' practices increased
substantially following the creation of the Data Bank. We conclude that
the increase was likely due to the licensing boards taking actions
against delinquent physicians who had previously slipped through cracks
in the regulatory system or who had earlier received warnings or
administrative fines.

In this article we explore the impact of the National Practitioner
Data Bank (NPDB), which was designed in large part to decrease the
likelihood that errant physicians might be able to avoid detection by
licensing boards and practice medicine. The Bank opened for business in
September, 1990. The intent of the U.S. Congress in establishing it was
to assist the states' physician (& dentist) licensing boards by
providing a clearinghouse for information. We use a decade of
longitudinal data to evaluate the Bank's impact on state licensing
board actions.

Physician self-regulation and the creation of the NPDB

The need for the creation of the NPDB stemmed, in large part, from
problematic self-regulation by the medical profession. Physicians
conventionally claim that only they have the specialized knowledge and
medical wisdom that is needed to understand and resolve problems in
their ranks. Medical services usually cannot be evaluated by outcomes
and acceptable process matters are not easily recognized by laypersons.
Self-regulation was deemed appropriate for physician licensing boards,
given that physicians typically are the only persons truly qualified to
evaluate medical services (Federation of Medical Regulatory Authorities
of Canada and the Federation of State Medical Boards, 2008).

The U.S. Congress, in an early attempt to improve care and curb
rising costs in Medicare, authorized a plan for self-review by the
medical community. The Social Security Act Amendments of 1972 (Public
Law 92-603) established Professional Standards Review Organizations
(PSROs) to monitor services being delivered to hospitalized Medicare
patients. The legislation stipulated that the individuals who were to
conduct these reviews would be physicians and not government bureaucrats
(Smits, 1982). PSROs were empowered to refuse payments for unacceptable
treatment and to exclude doctors from participation in the benefit
program. But only rarely did PSROs use these sanctions. During the
eleven-year experiment with peer review boards, from 1973 to 1984, the
PSROs formally disciplined a total of seventy hospitals and physicians
(Wallis, 1986). The review panels preferred to educate errant physicians
with bulletins and explanations of guidelines, during informal meetings
or small conferences (see Jesilow, Pontell & Geis, 1993 for a more
comprehensive discussion of the PSROs).

Doctors of the time were notoriously unwilling to label the
practices of fellow physicians as deviant. Elliott Freidson (1975)
illustrated the process by which doctors excused the deviant behavior of
colleagues in his classic work, Doctoring Together. Freidson studied a
group medical practice and concluded that each physician was allowed to
practice as the individual saw fit, as long as the behavior was not
filled with gross deficiencies. Aberrant behavior was excused by peers
as something any doctor might reasonably do given the circumstances.
Doctors were a delinquent community, he concluded, when it came to
monitoring the conducts of its members (Freidson, 1975; see also Peters,
1972; Richardson, 1972; Swazey, 1991 regarding physician peer review and
monitoring).

The failure of self-regulation played a major role in sparking
creation of the NPDB. The U.S. Congress disapproved of the practices of
many hospital quality committees to not report misdeeds to licensing
boards, particularly if the errant individuals left their current
hospital positions (House Report, 1986). It was possible for misbehaving
physicians to escape the full impact of past negative evaluations of
their practices by simply not informing new employers of their
existence. Moreover, physicians who had restrictions placed on their
practices by some state boards could continue the conduct that had
gotten them into trouble by moving to other states. They already held
licenses in the jurisdictions to which they relocated and they could
open shop immediately upon arrival, without revealing their embarrassing
past (Jesilow et al., 1993; see Kusserow, Handley & Yessian, 1987
for an overview of state medical discipline at the time). The NPDB was
designed to minimize such loopholes (Brennan, 1998).

National Practitioner Data Bank

The enabling legislation for the National Practitioner Data Bank
(the amended Health Care Quality Improvement Act of 1986) grants
immunity from lawsuits to mandated providers of information. Hospitals
are required to report doctors who resign after an investigation of them
was started as well as any actions that affect a physician's
clinical privileges for at least 31 days. Hospitals are obligated to
consult the registry at least once every two years regarding present and
prospective personnel. State licensing boards, insurance companies,
professional societies, and healthcare institutions are mandated to
report a variety of information to the Data Bank, including malpractice
judgments and settlements, sanctions imposed by medical boards, losses
of membership in professional societies, and actions taken by hospitals
and other healthcare units against physicians and dentists. The NPDB
fulfills its clearinghouse responsibility by making this information
available to authorized entities. The establishment of the NPDB was
based on the beliefs that, once armed with information, medical boards
would be less likely to license inappropriate individuals and be more
likely to take actions against doctors who had severe shortcomings (U.S.
Department of Health & Human Services [hereafter HHS], 2007).

The National Practitioner Data Bank has been a lightning rod for
criticism throughout its history, despite a dearth of information on its
impact (Robertson, 2001; Ryzen, 1992; Satiani, 2004; Todd, 1995; Waters,
Warnecke, Parsons, Almagor & Budetti, 2006). The critiques have
often come from medical quarters, probably because the existence of the
NPDB implies a lack of confidence in the integrity of the medical
profession and challenges its position that it can monitor its own.
James Todd (1995), former president of the American Medical Association,
for example, criticized the NPDB for doing very little to improve
matters. He concluded that "[government's role should be to
set the standards to which the profession should be held accountable,
leaving it to the profession and those it serves to decide how close the
practitioner or entity approaches those standards (p. 378)."
Studies of the NPDB have focused on process matters (e.g. reporting and
inquiries to the NPDB and, in particular, its use in the credentialing
process) (Baldwin et al., 1999; Neighbor, Baldwin, West & Hart,
1997; Office of Inspector General [hereafter OIG], 1995; Oshel, 1995;
Waters et al., 2006). These reports have generally found that the Data
Bank is being consulted. The authors of a recent study, for example,
concluded that "[m]ost institutions make timely NPDB inquiries that
facilitate widespread use of the information in credentialing activities
(Waters et al. 2006, p.30)." Reporting of errant physicians to the
NPDB is another matter.

The OIG for Health and Human Services reported that from its
inception in "September 1, 1990 to December 31, 1993, about 75
percent of all hospitals in the United States never reported an adverse
action to the" NPDB (Brown, 1995, p. i). The OIG was also troubled
by the vast variation of reporting between states and raised concern
about the suggested differences "in the capacity or willingness of
hospitals to submit reports to the Data Bank (Brown, 1995, p. ii)."
A later OIG report noted that during the NPDB's first nine years of
operation, managed care organizations informed it of only 715 adverse
actions and that eighty-four percent (1,176 of 1,401) of the
organizations had not reported even one (Yessian, Greenleaf, Hereford,
Han & Levine, 2001).

A few studies suggest that hospital committees have avoided the
law's reporting requirement by utilizing penalties that legally do
not need to be conveyed to the NPDB. Increased monitoring of a
physician's professional activities or requiring the physician to
attend continuing medical education, for example, are actions that do
not need to be reported. Hospital administrators admit using these
penalties rather than restricting a doctor's clinical privileges,
which would require a report from the hospital to the NPDB. Hospitals
(& errant physicians) also avoid mandated reports by allowing the
problem practitioners to resign or voluntarily surrender their clinical
privileges (Baldwin et al., 1999; Neighbor et al., 1997; HHS, 1995).

Another likely consequence of the Data Bank has been an increase in
the number of physicians fighting malpractice charges, instead of
settling with plaintiffs. The only quasi-experimental study (pre- post-
design) of the NPDB that we found in the literature concluded that
physicians and their insurers were less likely to settle malpractice
cases following its introduction and that this "appears to have
decreased the proportion of questionable claims receiving compensation
(Waters et al., 2003a, p. 283)." Medical boards often take
malpractice payments as triggering events for further investigation of
physicians (Bovbjerg & Petronis, 1994; Fellmeth & Papageorge,
2005; Studdert et al., 2006; see Grant & Alfred, 2007 for a recent
discussion of the operation of state medical boards). The suggestion is
that, following the introduction of the Data Bank, physicians chose to
fight questionable charges rather than allow their insurers to settle
claims, which would have then been reported to the NPDB and eventually
made known to licensing boards. Of course, whether one sees such matters
as positive or negative outcomes depends on your viewpoint. The former
AMA president we have already quoted labeled as an "adverse
effect" a 1993 finding by the Physicians Insurers Association of
America "that physicians were less willing to settle claims as a
result of the NPDB (Todd, 1995, p. 377)." The lack of experimental
evidence regarding the NPDB's impact has left a substantial gray
area concerning its usefulness, which has allowed critics sufficient
space to condemn its operation or to call for substantial changes. This
paper partially corrects this situation by analyzing state licensing
actions before and after the enactment of the Data Bank. Congress
expected that the creation of the NPDB would decrease the likelihood
that errant physicians could continue their conduct by withholding
information from new employers or by moving to another state. We
hypothesized, controlling for other matters, a statistically significant
increase in the percentage of physicians receiving a sanction from state
boards following the introduction of the NPDB. Such a finding would
suggest that fewer inappropriate physicians are being allowed to
practice and that Congress's will is being fulfilled.

METHODS

We employed a quasi-experimental design to determine whether the
National Practitioner Data Bank may have affected physician sanctioning
by state licensing boards. Data on state licensing actions by year are
available from the Federation of State Medical Boards (FSMB) website for
the fifty states (Federation of State Medical Boards, n.d.).

We decided to only study the period, 1985-1994. Our decision to
study this interval was guided by a number of factors. First, we needed
accurate data from years prior to the establishment of the NPDB in order
to determine its impact. Reporting of the number of licensing actions by
individual state boards to the FSMB was inconsistent before 1985
(Galusha & Breaden, 1989); this date then became the earliest point
for our study.

Our decision to end our study period at 1994 was based on two
matters. The first for us was more significant and needs a bit of
explaining. It stems from the punishment philosophies of deterrence and
incapacitation. The threat of malpractice suits and potential licensing
actions, according to the theory, act as general deterrents, in that
physicians will avoid risky procedures in order to prevent future legal
and financial obligations. In addition, physicians may be encouraged to
take precautions during procedures to avoid potentially costly accidents
and loss of license (Cane, 1982; Holmes 1873 & 2005/1881). The
suggestion is that increased sanctions by individual state licensing
boards may deter some risky physician behaviors and result in fewer
licensing actions in later years. Incapacitation is expected to also
diminish the number of licensing board actions against physicians.
Confiscating the licenses of aberrant physicians assures boards that at
least the most negligent physicians are removed from practice. The
difficulty for us is determining whether declining (or leveling) rates
of licensing actions after 1994 are due to a diminishing of the impact
of the NPDB as a clearinghouse for information, or due to deterrence
(physicians avoiding risky procedures) and incapacitation (negligent
physicians losing their licenses or having them limited). An analogy
might help clarify this matter.

A state may implement sobriety checkpoints to catch impaired
drivers. Initially, the checkpoints result in a substantial rise in
arrests, but as time goes by the number of arrests diminish. Is the
reduction a result of the failure of the checkpoints to snare drunk
drivers? Or is it a result of the success of the checkpoints; potential
drunk drivers are in jail and unable to drive (incapacitated), while
others have been deterred from getting behind the wheel? Does a lack of
arrests indicate that the police are doing a poor job, or does it
reflect the fact that there is no one to arrest? For our purposes, might
leveling rates of licensing actions after 1994 be due to a failure of
the NPDB as a clearinghouse for information, or might they be a
consequence of negligent physicians losing their right to practice
medicine combined with physicians avoiding risky actions? Determining
the answers to these questions is not easy and may require individual
level data that is not currently available (e.g., see Reuter &
Bushway, 2007).

The second reason we ended our study period at 1994 stems from
changes in various states tort laws that complicated matters after 1994.
We expected that individual state tort reforms might have an impact on
licensing actions, independent of any impact of the NPDB (Lavenant,
Hayward & Jesilow, 2002). The statistical model we used in the
current study was able to consider such matters. But new rounds of tort
reforms beginning in 1995 were problematic. More than twenty states
passed reforms that their courts then ruled unconstitutional and, as a
result, their use was curtailed (Center for Justice & Democracy,
n.d.). Inclusion of years after 1994 in our analyses would compromise
the results; many states had periods when the reforms were momentarily
on-the-books, but it is impossible for us to determine the times when
the temporary tort reforms might have affected licensing board actions.
State licensing board actions occur much later than the malpractice
filings that may eventually trigger them. Put simply, there are periods
when the reforms were legislated, but it is not possible to tell if the
laws were in force. We are not alone in dealing with such concerns.
Similar problems involving legal modifications to state tort laws led
the authors of a recently published study to limit the years of their
inquiry (Guirguis-Blake, Fryer, Phillips, Szabat & Green, 2006). We
decided to curtail our study data at 1994 to minimize the impact of such
matters on our dependent variable.

Dependent variables

We ran models with two dependent variables, "serious
sanctions" and "other prejudicial actions." The serious
sanction variable includes a combination of probation, license
revocation, and license suspension. As the term implies, the variable
consists of the most serious sanctions state medical boards can impose
on medical practitioners. Matters that are included within these three
categories need not be clear-cut. Revocation involves losing one's
license; suspension may involve the temporary loss of one's license
or specific parts of one's practice, while probation may restrict a
license. Under certain circumstances, suspension and probation may be
similar (e.g. when a male physician is suspended from seeing female
patients without a nurse present). We also combined the sanctions of
probation, license revocation, and license suspension for the purpose of
analyses because during the period of study many states often had no
actions (or only one or two) in any single category. Combining the
sanctions increased the potential for finding a statistical change.
Moreover, the purpose of Congress in establishing the Data Bank was to
diminish the likelihood that errant physicians would slip through
loopholes. We reasoned that any of the severe sanctions indicated that
the physician had been snared.

The "other prejudicial actions" dependent variable
includes less severe disciplinary responses that boards can employ, such
as consent orders, fines, and letters of admonishment. We assumed that
the use of these lesser sanctions was in part due to the level of
information that licensing boards had about physicians. The specific
sanction a physician receives is likely tied to a number of factors,
including the quality of the evidence and the resources of the board to
conduct investigations (see generally Fellmeth & Papageorge, 2005).
The extent of the information a board had about an errant physician
might indicate use of the lesser sanctions. The introduction of the Data
Bank, we reasoned, would increase the extent of information boards could
obtain about errant doctors and result in a rise in the use of serious
sanctions and a concomitant decline in the use of other prejudicial
actions.

To standardize the dependent measures, information was collected on
the number of medical doctors in each state. Physician populations were
obtained from the American Medical Association's Physician
Characteristics and Distribution in the United States (Randolph et al.
1995). Data were collected for the same years as the FSMB data,
1985-1994.

Independent variables

The inclusion of independent variables in the analyses was needed
to determine if factors, other than the NPDB, were at work. We collected
information on a number of matters that we believed might affect a state
licensing board's sanctioning rate, including tort reforms, urban
population, political ideology, religiosity, punitive ideology, and
population health. We derived our hypotheses from the fields of health
economics and criminology.

Tort reforms

We have already discussed our logic for the inclusion of the state
tort reforms in the model; there is evidence that they may impact the
number of licensing actions (Lavenant et al., 2002). Changes in tort
laws may be an alternative explanation for changes in a state's
sanctioning rate.

The American Medical Association's Tort Reform Compendium
(Bannon, 1989) outlines ten medical law revisions each state undertook
between 1975 and 1988 (addendum clause, arbitration, attorney fee
regulation, collateral source rule, frivolous lawsuit penalties, joint
and several liability, limits on recovery, patient compensation funds,
periodic payments of damages, and pretrial screening panels). We updated
this information to 1994 with data from the American Tort Reform
Association, which provides state reforms on its website (ATRA, 1995).

Urban population

The extent of a state's urban population may affect the impact
of the NPDB. The OIG noted that hospitals in rural states were
"heavily represented among those with the highest level of
nonreporting" to the NPDB, while hospitals in urban states were
among those with the highest level of reporting (Office of Inspector
General, 1995: iii). As a result, medical boards in urban states may be
more influenced by the establishment of the Data Bank.

The extent of a state's urban population may also be related
to the influence of the NPDB, because "urbanicity" may impact
the probability that victims will bring civil suits. Malpractice
judgments and settlements are required to be reported to the NPDB.
Patricia Danzon (1984) found that a state's degree of urbanization
was positively associated with the rate of malpractice claims in the
state. The suggestion is that the NPDB will have a greater impact in
urban states.

"Urbanicity" may also influence characteristics of
medical board members, who sit in judgment on doctors, and impact
licensing decisions. The extent of a state's urban population is a
common independent variable in studies of court sentencing because it
affects judicial characteristics (Bullock, 1961; Meyer & Jesilow,
1997; Myers, 1987; Weber, 1954). Similarly, licensing board members in
urban states, because of their background, may see things differently
than board members in predominately rural ones and this may affect the
likelihood of sanctioning.

We included as an independent measure in our study the percentage
of a state's population that lived in urban zones. We hypothesized
that states that were more urban would be more impacted by the NPDB.
Urban, nonurban, farm, and other measures of the total population of
each state are from the 1990 Census (U.S. Bureau of the Census
[hereafter Census], 1990).

Political ideology

Physician sanctioning may also be affected by the political
ideology of a state. Boards have a wide array of punishments available
to them, including warning letters, probation, education,
rehabilitation, and revocation (Grant & Alfred, 2007). Errant
physicians who are sanctioned by liberal boards may receive dispositions
that differ from wrongdoers who face more conservative board members
(Davis, Severy & Kraus, 1993). Research with judges has demonstrated
that Democrats were more inclined to take a liberal posture in decision
making, while Republicans were more conservative (Nagel, 1961; Tate,
1981). We reasoned that Republican-dominated licensing boards would be
more likely to act on the information derived from NPDB reports to
sanction errant physicians and, as a result, the NPDB would have a
greater impact in these states.

We attempted to collect the political party affiliation of board
members during the study period by writing the state licensing agencies,
but were not successful. Lacking a direct measure of political ideology,
we posited that a licensing board would reflect the ideology of the
state within which it resided.

We collected information on each jurisdiction's presidential
voting for 1988 (Reagan elected President) and 1992 (Clinton elected
President). States that each year supported the Republican candidate
were considered conservative. States that each year supported the
Democratic candidate were considered liberal. States that voted
Democratic one year and Republican another were considered moderate.

Religion

Religion is a common independent variable in social studies and is
considered to impact judicial decisionmaking (Idelman, 1993; King &
Hunt, 1984). Once again, we equated medical board members with judges
and reasoned that religion would play a role in the likelihood of errant
physicians being sanctioned. That is, we hypothesized that "more
religious" states would vary from "less religious" ones
with respect to the impact of the NPDB.

Rather than basing our measure on distinctions between religions,
we decided to use a measure that reflected religious activity. A rate of
church membership was used for each state, based on 1990 census figures.
These data are available from the American Religion Data Archive web
site, maintained at Pennsylvania State University and include church
members as reported by 133 Judeo-Christian church bodies (ARDA, n.d.).

Punitive ideology

We thought that a state's punitive ideology might also affect
its medical licensing board's activities and influence any impact
of the NPDB; that is, some states may prefer harsh punishments, while
other states may favor milder ones. Our measure of a state's
punitive ideology was the percentage of the state's population who
were incarcerated. The prison population is driven by the willingness of
citizens to sentence petty offenders to long prison terms and to pay for
housing them. California's "Three Strikes" law is
illustrative. It caused the state's prison population to rise
dramatically at the same time that measured crime in the state was
declining.

To measure the state's punitive ideology, we began with the
number of prisoners under state or federal jurisdiction (December 31st
year-end total) annually from 1985-1994. These data are available as a
downloadable spreadsheet (Hill & Harrison, 2005). The 1990 state
census population was used to calculate the percentage of the
state's population who were incarcerated, which was our measure of
a state's yearly punitive ideology.

Population health

The general health of a state's population may affect
opportunities for malpractice, which should ultimately affect state
licensing board actions. A relatively ill population in any given year
might temporarily overload the capacity of the medical profession to
safely treat patients and result in improper care and physician
sanctioning.

We computed the number of inpatient hospital days per state
resident as a measure of the relative health of a state. The annual
inpatient census is available from the Annual Survey of the American
Hospital Association (American Hospital Association, 1984-1993). We used
the 1990 Census to ascertain each state's population.

Table 1 provides the descriptive statistics for the additional
independent variables used in the pooled time-series analysis. Table 2
presents the bivariate correlations between states' sanctioning
rates and the additional independent variables.

Design

We used a panel analysis to ascertain the impact of the
establishment of the NPDB on state licensing board actions. The method
allows us to also determine the impact of the passage of the individual
tort reforms (which were passed in different years for different states)
and our additional explanatory variables.

We resolved that a random effects regression model would be a good
tool for analyzing our data. Random effects models, compared to fixed
effects, allow for estimates of both between-state differences as well
as within-state changes over time (Hsiao, 1986). Fixed effects models,
in contrast, cannot include time-invariant predictors. Such
time-invariant predictors, however, are of interest in this study. These
include some state-specific effects, such as the extent of urban
population, for which we do not have yearly measures during the study
period.

Our longitudinal data are arranged into a pooled time-series of 50
states during 10 years. Each state has 10 records of data, equivalent to
a survey panel data set with 10 waves. An Ordinary Least Squares (OLS)
solution is inappropriate because OLS use assumes that observations are
independent of one another (Johnson, 1995). Our records are dependent
because each state contributes 10 records to the data set (Allison,
1994). A generalized least squares (GLS) solution for the model might
solve the dependence problem by assigning weights "based on the
components of variation that fall between and within individuals in the
sample (Johnson, 1995: 1070)." The distributions of our dependent
variables, however, are positively skewed (serious sanctions per 1000
physicians: mean=3.508, SD=2.450, variance=6.005, range =0 to 18.02,
skewness=1.599, estimate of dispersion = 6.005/3.508 = 1.712; other
sanctions per 1000 physicians: mean=2.393, SD=2.263, variance=5.120,
range=0 to 14.12, skewness=1.863, estimate of dispersion=2.140). If a
dispersion estimate (variance divided by mean) is greater than 1, then
the data may be overdispersed; if less than 1, then data may be
underdispersed. If the value is within the typically-acceptable 0.8 to
1.2 range, the model can be considered to be correctly specified (Hilbe,
1994; SAS Institute, Inc., 1993). The likelihood ratio test for
overdispersion for serious sanctions and other prejudicial sanctions was
calculated for each regression model and resulted in Chi-squared values
that were significant (p=.000). The statistically significant evidence
of overdispersion indicates that the negative binomial regression model,
which we used, is preferred to the poisson regression model. Figures 1
and 2 display the histograms for the two dependent variables.

[FIGURE 1 OMITTED]

[FIGURE 2 OMITTED]

The statistical design is a random effects, negative binomial
regression model for pooled time series panel data for 50 states during
10 years, 1985-1994. The two dependent variables are the number of
serious sanctions and the number of other prejudicial sanctions,
standardized for the population of physicians in each state (in STATA
statistical program, the natural log of the physician population was
used as the "offset" function; this strategy makes use of the
correct probability distribution of the dependent variables). The tort
reforms are represented by a series of dummy dichotomous variables,
"0" for years before the tort was altered and "1"
for the first full year the tort reform was in effect and all subsequent
years. The tort reforms are lagged by two and three years in the models
to reflect our belief that it would take a minimum of two years for a
reform to alter the pattern of tort cases. Our model includes 10
different events (the timing of the passage of the individual tort
reforms in each state), five additional control variables
(characteristics of states), and period effects. The model includes both
time-invariant and time-variant variables. The predictor variables that
vary over time include punitive ideology and population health. The
variables that do not vary over time include urban population, political
ideology, and religiosity.

In this equation, SERIOUS is the number of serious sanctions (the
first dependent variable), OTHER is the number of other prejudicial
sanctions (the second dependent variable), s is the number of states, t
indexes the time-series (from 1985 to 1994), [beta]0 is an overall
constant, [beta] represents the regression coefficients, k is the number
of measured independent variables, TORT indexes the individual tort
reforms, STATE indexes the control variables (state characteristics),
and PERIOD indexes the dummy variables representing period effects. a is
a constant effect for individual states that is treated as a random
variable in the model and is assumed to be uncorrelated with the
independent variables (Hsiao, 1986; Johnson, 1995). [alpha] captures the
effects of all unmeasured time-invariant variables of states (Maddala,
1987; Petersen, 1993). [epsilon] is an error term, the effect of
unobservable variables that vary across states and over time. Not
represented in the equation are the standardization of the dependent
variables, the lag terms, and an error term accounting for
overdispersion in the sanctioning rates. The method of estimation used
is maximum likelihood, and the estimated [beta]s are the weighted
average of the between-state and within-state estimators.

RESULTS

We ran several preliminary models to disentangle period effects and
the effects of the independent variables on the sanctioning of
physicians by state licensing boards. The impact of the NPDB is evident
in Model 2 that simultaneously considered the impact of all of our
independent variables (see Tables 3 and 4). Beginning with the
NPDB's first full-year of operation (1991), there was a significant
spike in states' serious sanction rates (IRR ranged from 1.39 to
1.62, pWe hypothesized that matters other than the introduction of the
NPDB might impact sanctioning by states' medical boards and we
included these in our model. We elsewhere discuss these in some detail
(Jesilow & Ohlander, in press), but our focus in this piece is on
the impact of the Data Bank. We do note here, however, that several of
these independent variables were associated with a state's serious
sanctioning rate. Our results suggest that alterations to states'
joint and several liability rules and the establishment of penalties for
frivolous lawsuits may have increased the use of serious sanctions by
medical licensing boards, while instituting arbitration and attorney fee
regulation may have decreased their use. Our analyses also revealed
factors of a state's population that were associated with severe
sanctions being levied. Rural, conservative states that were relatively
punitive had higher severe sanctioning rates than states that were more
urban, politically moderate or liberal and less punitive (see Table 3).

CONCLUSIONS AND DISCUSSION

The National Practitioner Data Bank, which was designed to minimize
the chances that a negligent physician would be able to continue
practicing, seems to have had an impact. Its implementation was
associated with statistically significant increases in the rates of
physicians being placed on probation, or having their licenses revoked
or suspended. State licensing boards, on average, levied serious
sanctions against 2.40 to 3.20 physicians out of every 1000 licensed
medical doctors during the years prior to the implementation of the
NPDB. That rate rose dramatically to between 3.92 and 4.77 during the
years immediately following full implementation of the Data Bank.

It seems unlikely that the rise in the serious sanctioning rate was
due to sudden increases in inappropriate behavior by physicians. A more
likely explanation for the sharp increase following the establishment of
the NPDB is that licensing boards were now taking actions against
physicians who previously were able to avoid detection or who received
milder punishments that allowed them to continue practicing. The use of
other prejudicial actions increased each year prior to the establishment
of the Bank, but decreased each year thereafter. The suggestion is that
some cases, which prior to the establishment of the NPDB would have
resulted in mild punishments, were treated more severely following the
establishment of the Data Bank. Required reports from hospitals,
insurance companies, professional societies, healthcare institutions and
state licensing boards to the Data Bank made it easier for individual
boards to learn of misdeeds by physicians and take corrective action.
This conclusion is supported by a survey of organizations that query the
NPDB; more than five percent of credentialing decisions were altered
because of the information the NPDB provided (Waters et al., 2003b).

The NPDB, similar to any public policy, may not be perfect and
there are areas of concern. The Data Bank, for example, relies on
reports from hospital committees and there is evidence that physicians
do not support the Bank and take steps to avoid reporting requirements
(Baldwin et al., 1999; Fellmeth & Papageorge, 2005; Neighbor et al,
1997; HHS, 1995). There is some indication from hospital administrators
that they are generally satisfied with "the accuracy of reports,
the timeliness of responses to queries, and the completeness of
reports," and have some dissatisfaction with "the fee for
querying, effect on staff workload, billing procedures, and clarity of
requirements and procedures (Neighbor et al, 1997, p. 664)." These
matters, however, do not seem serious enough to warrant hospital
committees avoiding the reporting requirements of the law.

It may not necessarily be the activities of the Data Bank that
physicians oppose; the NPDB is merely a clearinghouse for information.
It may be that what irks the hospital committees is that which the NPDB
represents: a questioning of their ability to police themselves and
increased government regulation of the profession. No longer is the
medical profession an autonomous group and its members resent the
reduction in their influence. This issue will likely take on a greater
presence in the public dialogue as the U.S. moves closer to universal
healthcare and physicians confront new government schemes to control
their behavior.

Bovbjerg, R. R., & Petronis, K. R. (1994). The relationship
between physicians' malpractice claims history and later claims.
Does the past predict the future? Journal of the American Medical
Association, 272, 1421-6.

Brennan, T. A. (1998). The role of regulation in quality
improvement. The Milbank Quarterly, 76, 709-731.

Federation of State Medical Boards. (n.d.). Accessed March 2007,
http://www.fsmb.org/fpdc_basummaryarchive.html.

Federation of Medical Regulatory Authorities of Canada and the
Federation of State Medical Boards. (2008) Medical regulatory
authorities and the quality of medical services in Canada and the United
States. Milbank Memorial Fund. Accessed June, 2008,
http://www.milbank.org/reports/0806MedServicesC
anada/0806MedServicesCanada.html

Fellmeth, J. D'Angelo., & Papageorge, T. A. (2005). Final
report Medical Board of California enforcement program monitor.
University of San Diego School of Law: Center for Public Interest Law.
Accessed January 29, 2006,
http://www.medbd.ca.gov/publications/enforcement _report.html.

Freidson, E. (1975). Doctoring together: A study of professional
social control. New York: Elsevier.